Nike (NYSE: NKE) is set to announce its fiscal fourth-quarter earnings (for the year ending in May) on Thursday, June 26, 2025, with analysts anticipating earnings of 12 cents per share on $10.71 billion in revenue. This represents an 88% decline in earnings year-over-year and a 15% decrease in sales compared to the previous year’s figures of 99 cents per share and $12.62 billion in revenue. Historically, NKE stock has decreased 65% of the time after earnings announcements, with a median one-day drop of 6.8% and a maximum observed decline of 20%.
The company indicated weak performance in the third quarter of fiscal year 2025, while expecting a low-to-mid-teens revenue downturn in the fourth quarter. Additionally, gross margins are projected to compress by 4 to 5 percentage points due to aggressive inventory clearance strategies. The full-year fiscal 2025 revenue is expected to decrease by 11%, with a slight 1% decline anticipated for fiscal 2026, indicating a slow and gradual recovery. The company has a current market capitalization of $88 billion with revenue of $48 billion in the past twelve months and profitability of $4.9 billion in operating profits and $4.5 billion in net income.
For event-driven traders, historical patterns could provide an advantage, whether by preparing before earnings or responding to post-release movements. Conversely, if you’re looking for upside with less volatility than individual stocks, the Trefis High Quality portfolio offers an alternative, having outperformed the S&P 500 with returns exceeding 91% since its launch.
Viewing earnings reaction history for all stocks is an exploration of one-day (1D) post-earnings returns. Over the last five years, there are 20 earnings data points recorded, with 7 positive and 13 negative one-day returns documented. In summary, positive 1D returns occurred approximately 35% of the time. However, this percentage drops to 17% when considering data for the last 3 years instead of 5. The median of the 7 positive returns is 6.7%, while the median of the 13 negative returns is -6.8%.
Additional data on the observed 5-Day (5D) and 21-Day (21D) returns post-earnings are also summarized along with the statistics in the table below.
A correlation between 1D, 5D, and 21D historical returns is a relatively less risky strategy (though not effective if the correlation is low). For instance, if 1D and 5D have the highest correlation, a trader can take a “long” position for the next 5 days if the 1D post-earnings return is positive. Here is some correlation data based on the 5-year and 3-year (more recent) history. Note that the correlation 1D_5D denotes the correlation between 1D post-earnings returns and following 5D returns.
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